Five Things You Need to Know About The Cerulean Credit Card

The Cerulean credit cards may look appealing at first glance, especially if you have poor credit. The card is issued by The Bank of Missouri, and served by Continental Finance. It doesn’t require any security deposit and has a potential high credit limit. It is also a Mastercard so it will be widely accepted. Your payments are also reported directly to the three major credit bureaus. This card is a must-have for credit-building.

The features are solid, but the annual fee and high interest rate make it seem a bit shaky. It has lower fees than other unsecured credit card for poor credit (FICO scores below 629). However, there are cheaper options that can help build credit.

This is what you need to know in order to build your credit.

Although the Cerulean credit cards don’t have monthly maintenance fees like other cards in their class, the annual fee should be enough to cause you to rethink your decision.

Cardholders are eligible for the following fees:

• An annual fee: 125.

• Late Payment Fee: Maximum $41.

• Additional fee: 30

You can save for the security deposit on a secured card if you are able to afford the Cerulean annual fee of $125. After closing your account, you’ll receive the deposit back along with a strong payment history. The $125 per year you pay for the Cerulean card is now gone.

Consider this alternative: The Capital One Quicksilver Cash Rewards Credit Card requires you to make a $200 security deposit. However, you can return it with a satisfactory payment history. You can get 1.5% cash back on most purchases. This makes it possible to return some monetary value even if your security deposit is not yet repaid. You are eligible for an automatic credit limit rise after six months of card ownership.

You can apply for Cerulean credit cards up to $1,000 with credit limits ranging from $300 to $1,000 depending on your eligibility. However, if you have bad credit you might be able to get a limit at the lower end. The card’s annual fees will only make matters worse.

You may be eligible for a $300 credit limit at first, but once you add the $125 annual fees, your credit limit is really $175 until you pay that fee. This will affect your purchasing power and impact your credit utilization ratio. It is the percentage of credit that you use, which is a key factor in credit scores. Experts recommend that you don’t use more than 30% of your credit limit. However, in the above scenario, you are already at around 42% — even before you swipe your card.

The good news about the Cerulean card is that you can double your card’s credit limit by making minimum payments on time during the first six billing cycles. Your account will be reviewed every six months for credit limit increases up to a maximum $3,000. This is a very high credit limit, but it isn’t enough to ignore some of the card’s drawbacks.

Instead of requesting a credit limit increase you might consider: A similar credit limit opportunity can be obtained with a low-cost credit card such as the Capital One Platinum Secured Credit Card. You may be eligible for a $200 credit limit and a $49. security deposit depending on your eligibility. You may be eligible for a $200 credit limit for a security deposit as low as $49. If you pay your monthly payments on time, it might be possible to get a higher credit limit within six months.

For those with poor credit, it’s not unusual to see credit card interest rates that are high. However, this can lead to debt if you also have to pay an annual fee. If you intend to keep a balance, or access cash, the Cerulean card’s 29.99% annual percentage rates, or APR for purchases and cash advances, is prohibitive. Cash advances will also be subject to a $10 fee or 3% fee, depending on the amount. )

Instead, consider the Chime Credit Builder Visa(r), Credit Card. This card allows you to build credit without taking on debt. The card doesn’t allow you to carry any balance and therefore it does not charge interest or fees. Except at MoneyPass ATMs located in 7-Eleven locations or any Allpoint and Visa Plus Alliance ATMs, out-of-network ATM withdrawal charges apply. )

To fund the flexible security deposit on your card, you must have a Chime account. However, it may be worth opening one if you need cash flow supplementation. SpotMe is a free overdraft service offered by Chime. It allows customers to access up to $200 without any fees if they meet the account requirements.

The Cerulean credit cards don’t offer the option to upgrade to an unprotected credit card, or to lower the annual fee. It’s better to have an option that you can switch to when you build credit.

Instead of looking for a way to upgrade to an unprotected card, consider the Discover it(r), Secured Credit Card. The issuer conducts automatic monthly reviews after seven month to determine if you are eligible to switch to an unsealed option. You will need to pay $200 for the security deposit. However, you can get your money back if you have a good payment record after closing the card or upgrading the issuer’s unsecure option. While the security deposit is tied up, you can still get some cash back with the card’s sign up bonus and ongoing cash rewards (2% at gas stations and restaurants for up to $1,000 combined purchases each quarter, and 1% for everything else).

A Continental Credit Protection program is an option on the Cerulean credit cards. This insurance covers you for the minimum amount owed in case of unemployment, disability, or hospitalization. The program will cover the balance of the account in the event of death. These terms apply. You must pay 99c per $100 to be eligible for coverage. A $1,000 balance will result in a monthly fee of $10. You will need to claim the benefits by email, phone, or mail in order to activate them.

Although this option can provide some peace of mind, it is unlikely to be worth the expense. Your estate will generally be responsible for paying any unpaid debts after your death. The debt will be paid if there isn’t enough money or property to pay it. The program only covers your minimum monthly payment for hospitalization. Even if you charged more than $1,000 to the card, coverage for the minimum payment would not be significant. The minimum payment is covered for 12 months in the case of job loss or disability. You might not have to rely on this option if you are eligible for unemployment or disability insurance.

Credit Builder is only available to those who have made a qualifying direct deposit of $200 or greater to their Checking Account. Your employer, your payroll provider, gig economy payor, or benefits payer via Automated Clearing House deposit (ACH) OR Original Credit Transactions (OCT) must make the qualifying direct deposit. Direct deposits are not eligible for bank ACH transfers, Pay Anybody transfers, verification or trial deposit from financial institutions, peer-to-peer transfers from services like PayPal, Cash App, Venmo, or Venmo.